Silvio Berlusconi, resilient Italian leader, corrupt media magnate, procurer of either illegal or barely legal prostitutes, and Bond-style villain with less charm than Ernst Blofeld and Rosa Klebb put together, has offered to resign as prime minister if and when the Italian parliament passes austerity measures demanded by the European Union. Italian bonds are carrying a hefty 7 percent-plus interest rate, meaning mostly everyone is charging the country increasing amounts of interest to borrow.
The NY Times eulogizes the fool who has been Italy's main political figure for 17 years:
"A season is over," said Mario Calabresi, the editor in chief of the Turin daily newspaper La Stampa, who said Mr. Berlusconi told him that he was not only stepping down, but also would not run for office again….
"The problem in Italy is not primarily the real data," Germany's finance minister, Wolfgang Schaüble, said in Brussels on Tuesday. "The debt is high, the deficit is not — economic data are not that bad. The problem is a lack of trust from the financial markets."
For all the relief on Tuesday, it is unclear that Mr. Berlusconi's exit would solve Italy's problems in the long run since any government that follows will be left to carry out tough austerity measures in a system built on political patronage.
"The real problem is that in reality, the austerity bill is an empty box into which they have to put things that will be very unpopular," said Mario Deaglio, a professor of economics at the University of Turin.
Italy's public debt stands at 120 percent of GDP, in an economy that most people believe is too big to bail out. The lack of trust from financial markets is well earned, as the government, both under Berlusconi and everyone else elected to office for about the past 50 to 75 years, has ardently refused to create anything like a sustainable public sector and welfare state. There is no reason to believe that will change any time soon, even if it brings the European economy, and that of the world, to a stop.
No one, including the Italians, should be sorry to see Berlusconi and an entire generation of leaders like him go. As multiple lawsuits against him attest, Berlusconi is a particularly putrid form of human being, but as far as politics go, he remains unexceptional in that he presided over a government that was ultimately incapable or unwilling to stare economic reality in the face and change a clearly disastrous course for his country and the wider world.
There's a lesson in Europe's failing dominoes for U.S. politicians who can't even pretend to make minor trims from massive expected increases in spending over the next decade. You can doll it up with whatever language you want to ("inviolate generational compacts," "protecting the poor," "protecting homeland security," etc.), but every time you refuse to cut spending after a decade of unrestrained growth in unsustainable spending, you're doing to current and future taxpayers exactly what Berlusconi does to this meter maid: Dry-humping us for the amusement and enjoyment of your well-connected friends. I hope it's good for you, at least.